Sometimes life can throw a curveball at you and credit may not always be the easiest to achieve. Home equity loans can be an efficient way to take out a secure form of credit and help with unforeseen circumstances such as renovations, retirement or post-secondary education. Whatever the situation may be, group capital can help you achieve the home equity loan you may need in a timely manner.
Home Equity Loan
Whether you need $50,000 or $5,000,000 Group Capital is your best alternative to a bank!
Home Equity Loan with Group Capital
- Fast & secure application process
- Any credit score approved
- Minimal documentation
- No hidden service fees
- Personalized financial advice
- Get money within a week*
What is a Home Equity Loan?
Home equity is the difference between the value of your home and how much you owe on your mortgage. A home equity loan is a way to tap into the equity you have built through your mortgage or use your property’s worth as collateral to borrow against it. Using home equity is a way to guarantee that the loan will be repaid back.
There are two ways that your home equity can increase:
- Paying down your mortgage
- If the value of your home increases
A home equity loan is a lump sum payment that is paid back on a fixed term, based on a payment schedule and has interest accumulated on the total amount. You may be able to borrow up to 80% of the appraised value of your home.
Reasons you may need a home equity loan from Group Capital:
- Consolidation of debts
- Home renovations
- Retirement planning
- Post-secondary education
Check out our home equity loan calculator to see what you can potentially be qualified for:
Looking for advice?
How does a home equity loan work?
First, the private lender looks at a property value. This will determine the equity value of the home.
Property Value
The first thing to understand is the current value of your property and how much is left on your mortgage. An appraisal will need to be done of the home to determine the current market value of the property.
Calculating your loan-to-value ratio
A calculation is done between the appraised market value of the property and home owed on the mortgage to determine what is available to be borrowed. You may be able to borrow up to 80% of the appraised value of the property.
Interest and Payments
Once you have done calculating what is available to borrow, you can continue with your application process where a Group Capital specialist can help you understand exactly how much you can borrow. The home equity loan is a lump sum payment to you. It will be on a fixed term with scheduled payments and interest will be calculated on the entire sum of the loan. Typically interest rates are lower on home equity loans than other conventional loans, which is an advantage to the borrower.
Home equity loan vs. Home equity line of credit (HELOC)
The main difference between a home equity loan and a home equity line of credit is the flexibility of the money you are borrowing. As mentioned before, a home equity loan is a lump sum of money that is on a fixed-term payment plan with interest accruing on the entire sum of the loan. The home equity line of credit, on the other hand, is a revolving form of credit. You can borrow as much as you need up to the credit limit, pay it back and reborrow if you must. The interest rate is variable but is only accrued by the amount that is borrowed.
Choosing what option is best for you
Depending on your financial situation will help to understand what option may be best for you. A home equity loan may be the best option when you have owned the property for long-term and have made substantial payments to your mortgage or if the property value has increased over time.
Sometimes credit may be an issue or accumulated high-interest debt is holding you back from excelling in your future. Whatever the situation may be, Group Capital can help you make the right choice in what lending option may be the best option for you!
Home equity loan FAQ’s
Private mortgages are the perfect solution for short-term financial needs. Most private mortgages are set for 1 to 3 years depending on your situation. This means that the final payment will be due at the end of the term, with the option to extend or renew.
Yes, you can get a Home equity loan even with bad credit. The lender looks at several factors when considering approval include the value of your home and your income. To improve your chances of being approved, try to pay off as many existing loans or debts as possible to improve your credit score.
- Very poor credit: 300 to 579
- Fair credit: 580 to 669
- Good credit: 670 to 739
- Very good credit: 740 to 799
- Excellent credit: 800 to 850
Rates vary for Home equity loans depending on how much is being borrowed and your credit history. Group Capital offers the most competitive rates in the industry.
The LTV for a property is equal to all mortgages on a property divided by the appraisal value of the property. If you own a home worth $2,000,000 and get a new first mortgage for $1,500,000 then your LTV ratio is 75%.
Yes, a second mortgage is a great way to consolidate debt, cover the cost of home renovations or act as a bridge loan. While a first mortgage puts a first lien position on your property, a second mortgage is done in conjunction with the first mortgage and puts a second lien on your property.
There are several fees associated with a private mortgage.
These may include:
- Legal Fees
- Land Transfer Taxes
- Real Estate Fees
- Broker and Lending Fees
- Private Mortgage Insurance
If all your paperwork is in order, it usually takes about two weeks for approval. There are some cases where you can be approved faster, but a higher interest rate may apply.
Use our mortgage calculator to discover how Group Capital can get you the best rates on your private mortgage. With just a few simple pieces of information, you can quickly learn how much you could qualify for on your private mortgage.
Contact us today to see how easy it is to do the things you want to do with the equity in your home.
